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Western profit increases

The sale of a tree-farm licence and improved lumber and log shipments allowed Western Forest Products to improve its bottom line by $10 million in the second quarter.

The sale of a tree-farm licence and improved lumber and log shipments allowed Western Forest Products to improve its bottom line by $10 million in the second quarter.

According to its second quarter financial statements released this week, Western netted $12 million from the sale of TFL 60 to Taan Forest Limited Partnership - a partnership of the Council of the Haida Nation and Haida Enterprise Corporation - while improved volumes of lumber and log shipments also helped increase total revenue to $253.1 million.

That total sales figure is the company's highest quarterly figure since the second quarter of 2007.

The company reported earnings before interest, taxes, depreciation and amortization (EBITDA) of $20.4 million for the second quarter, up from $9.3 million in the first quarter of 2012, though slightly down from the $21.2 million in the second quarter of 2011.

"Operationally the second quarter was executed well," said Western chief executive Dominic Gammiero. "Sales volumes, production, and productivity all improved."

Gammiero noted while prices in the export log, pulp log, and sawmill byproduct markets were significantly lower than last year and demand from Japan was slightly weaker, the company still managed to deliver "our eleventh straight quarter of positive EBITDA."

During the second quarter Western also announced it had invested $6.7 million in auto grading technology for its Alberni Pacific sawmill and completed the refinancing of its revolving term loan facility to $110 million on improved terms.

Western also announced Don Demens will take on the role of company president. Demens, who joined the company in 2009, had been a senior vice president of sales and manufacturing before taking on the role of chief operating officer in 2011.

"Don has been instrumental in the turnaround of Western. Under his leadership we have seen a change in business culture with a strong focus on margin," said Gammiero.

"The board has full confidence in appointing Don as president. This appointment positions Western with a strong succession framework to build the future of the company."

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